Hotel Industry Performance Europe

European hotels reported performance gains in the first quarter of 2017 when compared to Q1 2016. Occupancy rose 4.1% to 63.5%, ADR increased 2.3% to 100.94 ($109.59) and RevPAR jumped 6.5% to 64.06 ($69.55).

Concluding with strong growth in March, the European hotel industry reported increases in each of the three key performance metrics during the first quarter of 2017, according to data from STR.

Euro constant currency, Q1 2017 vs. Q1 2016

Europe

Occupancy: +4.1% to 63.5%

Average daily rate (ADR): +2.3% to EUR100.94

Revenue per available room (RevPAR): +6.5% to EUR64.06

Local currency, Q1 2017 vs. Q1 2016

Baku, Azerbaijan

Occupancy: +74.9% to 49.5%

ADR: +25.5% to AZN171.46

RevPAR: +119.5% to AZN84.85

With one of the world’s most improved economies in 2017, rising 13 spots in the World Economic Forum’s global ranking, the Azerbaijani capital experienced massive uplifts in hotel performance in Q1. While ADR increased, exchange rate fluctuations have made the destination cheaper for many international visitors. STR analysts note that the performance growth is particularly impressive considering the market experienced significant supply growth of 18.1% in 2015 and 6.8% in 2016. Looking ahead, Baku currently has two new hotels In Construction and another pair in the Planning stage.

Spain

Occupancy: +2.3% to 67.5%

ADR: +4.8% to EUR100.76

RevPAR: +7.2% to EUR68.06

March 2017 marked Spain’s 47th consecutive month of year-over-year RevPAR growth. Despite a slight slowdown in occupancy and ADR compared with January and February, Spain still posted a 3.6% increase in RevPAR in March. Barcelona was the standout market in Q1 with a 13.6% increase in RevPAR that was equal parts occupancy and ADR growth. March was a particularly strong month for Barcelona, with occupancy up 8.0% and ADR up 18.0%. Performance was boosted by the Mobile World Congress (27 February through 2 March).

United Kingdom

Occupancy: +2.6% to 70.6%

ADR: +4.1% to GBP83.73

RevPAR: +6.8% to GBP59.12

U.K. hotels continued a run of positive year-over-year performance that started late in 2016. March was the strongest growth month of the quarter (RevPAR: +8.3%), thanks in part to a favorable Easter calendar shift. STR analysts also attribute performance to Brexit and the devaluation of the British pound with a subsequent increase in domestic and international hotel demand. Performance in the country’s largest market, London, was not disrupted following the Westminster attack on 22 March.

STR provides clients from multiple market sectors with premium, global data benchmarking, analytics and marketplace insights. Founded in 1985, STR maintains a presence in 10 countries around the world with a corporate North American headquarters in Hendersonville, Tennessee, and an international headquarters in London, England. For more information, please visit str.com.

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